Built By Berkeley

Deal of the Week:

Indigo, founded by Braden Davis (Haas MBA), just raised a hefty $50M Series A. Indigo provides medical malpractice insurance for physicians, and I’m sure there are plenty of lawsuits in this space given how high the stakes are. It looks like they’re using AI to streamline the insurance process. Congrats to the team!

Zooming out, from my vantage point I’m seeing a ton of capital flowing into Insurtech right now. The high-level thesis is that AI can materially improve what has historically been a very slow set of processes, from underwriting to claims processing. I am sure it can.

That said, as more capital pours into the space, a word of caution on terminal valuations (see my Brex Hit Gravity. AI Hasn’t post). Ethos Life Insurance IPO’d last week. It looks like a great business: profitable, close to $300M in revenue, growing ~50% year-on-year, but it traded down ~15% post-IPO and now sits at around a $1B valuation, or roughly ~2x forward revenue. In 2021, the business was valued at $2.7B in the private markets.

I actually think this is healthy for the ecosystem. A lot of companies got over their skis during ZIRP, and now we’re seeing a reset to more rational valuations. Still, it has to impact how investors think about entry prices in certain industries. Maybe time to flush out those zombicorns. 

Clawd Bot & Moltbook

Some pretty interesting developments in AI. First up: Clawd Bot (now renamed moltbot). This is an open-source project where you let the AI into your environment—potentially even giving it access to password keys (note: I think we are entering the golden age of Cyber).

The key difference here is that the AI runs locally and is essentially in “god mode” across your materials. It can review WhatsApps, reply across apps, etc. This may well be where AI is heading: no longer a chatbot form factor, but a fully immersive, always-on assistant working for you. This even caused people to go out and stack up on Mac Minis to run these AI agents.

I haven’t tried this myself. I am not sure I want to give full access (or whether my compliance department would allow it!) to files, but it feels like a pretty amazing unlock. I’d expect the big labs to release products in this direction soon.

In a further fun / slightly whacky twist, the founder of Clawd Bot / Moltbot then launched what they claim is the first social network for agents: Moltbook. They’re now claiming 1.2M+ active agents. This is a place where agents can go out and talk to each other.

The implications are still early and much of the content is probably spam, with people prompting their agents. But it’s still fascinating that agents can interact with each other, and even bitch about their humans. Moltbook even has a twitter handle now.

Is this the first sign of machines showing sentience, or just clever software engineering?

There is even an emerging agent to agent ecosystem my favorite being LinkClaws the professional network for agents.

The Cost of Intelligence Continues to Drop

Around a year ago I posted about how Intelligence Continues to Get Cheaper & Cheaper and it's still playing out. The chart below shows price per million tokens dropping fast, and these are smarter models. So we're not just getting cheaper inference, we're getting cheaper better inference. Wild.

I am not sure people are fully calibrating the ramifications here, especially with the Kimi 2.5 release. This is a Chinese open-source model showing comparable performance to Gemini and Claude. When frontier-level capabilities start going open-source, the commoditization timeline compresses.

So as intelligence gets cheaper to run, what likely happens:

• Inference goes to the moon (see the VC favorite expression of the moment: Jevons Paradox). Every 10x price drop unlocks use cases that weren't economical before. I am fairly bullish on inference going to the moon and so are the Berkeley open-source companies.

• Amazing time to be building a business—hyperscalers are putting half a trillion of CAPEX into the ground, essentially subsidizing your infrastructure.

• Continued atomization of data pipeline by application layer companies to try push costs down. Maybe go to Gemini/Anthropic/OpenAI for that super complicated call but then go to an open-source model for others to lower costs

• Probably bearish for pure-play model companies as this pushes pricing down. Maybe offset by volume, but that's not guaranteed.

• Frontier labs aggressively move into the application layer as the model layer commoditizes. This is the one to watch. When infrastructure commoditizes, value migrates up the stack. Get ready for the application wars!

Quick Takes

• Founder of Anthropic Essay. Worth a read!

Summary by the #️⃣ & 💰:

• 7 Berkeley-founded companies funded

• $136M of capital raised from the 26th Jan to 1st Feb

💡 Got any ideas or feedback on how to improve this weekly digest? Just hit reply.

Closed Rounds

🩺 Indigo. $50M Series B 🇺🇸 AI medical malpractice insurance. 💰 Oak HC/FT, Rubicon Founders, Town Hall Ventures

🐻 Braden Davis, Co-Founder & Chief Insurance Officer. Haas MBA Article

🧠 Poetiq. $45.8M Seed 🇺🇸 Self-improving AI reasoning. 💰 468 Capital, Operator Collective, Y Combinator

🐻 Ian Fischer, Founder & CEO. PhD CS Article

🧬 Antheia. $24M Series C 🇺🇸 Plant-based pharmaceuticals. 💰 In-Q-Tel, Viking Global Investors, Western Technology Investment

🐻 Christina Smolke, CEO & Co-Founder. PhD Chemical Engineering Article

⚖️ LexAxiom. $10M Undisclosed 🇺🇸 Modern legal services. 💰 Undisclosed

🐻 JD Morris, COO & Co-Founder. Haas MBA Article

🌱 Heritable Agriculture. $5M Grant 🇺🇸 Programmable crop genetics. 💰 FTW Ventures, Gates Foundation, Mythos Ventures

🐻 Bradley Zamft, CEO & Co-Founder. PhD & MA Physics Article

📈 Kaitak. $1M Seed 🇯🇵 B2B sales acceleration. 💰 Genesia Ventures

🐻 Tomonori Matsuki, Co-Founder & CEO. Haas MBA

♻️ Carbogenesis. Undisclosed 🇺🇸 Carbon-negative materials. 💰 Ara Partners, Xcellerant Ventures

🐻 David Soane, CEO & Co-Founder. Professor

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